Scandinavian Working Papers in Economics
Lund Papers in Economic History,
Lund University, Department of Economic History
No 276: The Rise and Fall of the Personal Income Tax in Argentina (1932–73)
Ramiro Coviello () and Sara Torregrosa-Hetland ()
Additional contact information
Ramiro Coviello: Department of Economics, Public University of Navarre, Postal: Departamento de Economía, Edificio Los Madroños, Campus de Arrosadía s/n, 31006 Pamplona, Navarra, Spain
Sara Torregrosa-Hetland: Department of Economics, Public University of Navarre, and Department of Economic History, Lund University, Postal: Departamento de Economía, Edificio Los Madroños, Campus de Arrosadía s/n, 31006 Pamplona, Navarra, Spain, , Department of Economic History, Lund University, Box 7083, S-220 07 Lund, Sweden
Abstract: This paper examines the evolution of the personal income tax in Argentina from its adoption in 1932 until a major reform in 1973. Drawing on tabulated data from historical tax returns and detailed tax legislation, we simulate pre- and post-tax income distributions to estimate the redistributive effects and progressivity of the tax, comparing our results with evidence from Sweden, the United Kingdom, and the United States. Our findings reveal three distinct phases. During the 1930s, the tax functioned as a low-rate class tax, accepted by economic elites as a fiscal tool rather than a redistributive instrument. Following a major reform in 1943, revenues and redistribution expanded substantially, driven by higher statutory rates, inflation eroding real exemption thresholds, and Peronism’s redistributive agenda. Even so, the tax remained confined to a small fraction of the population, with modest redistributive effects by international standards—in sharp contrast to the mass taxes that emerged in developed countries during the World Wars. From the late 1950s, redistribution collapsed as widespread evasion, fuelled by inflation and a crisis of fiscal legitimacy, eroded the tax base. This collapse reflected a shift in elite behaviour: from initial cooperation to active evasion as a means of resisting redistribution.
Keywords: personal income tax; progressivity; inequality; redistribution; fiscal policy
Language: English
80 pages, October 26, 2026
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